Amazon’s key UK enterprise paid simply £3.8m extra company tax final yr than in 2019, at the same time as gross sales elevated by £1.89bn.
Accounts filed at Corporations Home this week present that the company tax contribution of Amazon UK Companies – the group’s warehouse and logistics operation, thought to make use of nearly all of the group’s UK workforce – was £18.3m within the yr to December 2020, up 26% from £14.5m a yr earlier than.
Income on the division rose by 1 / 4 over the identical interval to £128m, whereas gross sales soared by 64% to £4.85bn.
That efficiency helped increase Amazon’s complete revenues within the UK, from retail, logistics and IT providers, to £20.63bn throughout 2020, roughly double the takings of Marks & Spencer and up barely greater than 50% from £13.73bn a yr earlier than.
The corporate, which has made its founder and outgoing chief government, Jeff Bezos, a fortune of greater than $200bn, tried to fend off accusations of tax underpayment by issuing a press release that mentioned its UK enterprise as a complete paid out £492m in “direct taxes” final yr, up from £293m a yr earlier than.
That determine consists of employer’s nationwide insurance coverage, enterprise charges, stamp obligation and company tax. The corporate didn’t get away its complete company tax invoice, however a minimum of half of the “direct taxes” determine is considered accounted for by nationwide insurance coverage and enterprise charges.
The group additionally mentioned it invested £1.6bn within the UK, greater than double the £690m a yr spent earlier than, because the group prolonged its operations to fulfill excessive demand throughout the pandemic. Investments embrace 11 on-site solar energy schemes to assist run its services, and a 350MW windfarm mission off the coast of Scotland.
Amazon now employs greater than 55,000 folks within the UK, together with 10,000 jobs created this yr, with extra employees being recruited to fulfill hovering demand. Amid a recruitment disaster throughout the UK, Amazon has resorted to providing new warehouse recruits a £1,000 becoming a member of bonus in an try to draw employees.
The corporate mentioned in a press release: “We’re happy with the numerous financial contribution we’re making to the UK economic system. Trying forward, we all know that the UK stays filled with alternative and we proceed to be excited by the potential to proceed to speculate, create jobs, develop expertise and have a optimistic impression in communities throughout the nation.”
Paul Monaghan, head of the Truthful Tax Mark marketing campaign group, described the corporate’s figures as “extra smoke and mirrors from Amazon, who’re nonetheless refusing to reveal precisely how a lot complete revenue they make within the UK, and the way a lot tax they pay on this”.
He continued: “A lot of their UK earnings continues to be shunted to Luxembourg, the place there’s a ‘loss-making’ subsidiary that’s not solely not paying tax, however is producing monumental tax reliefs that can be utilized sooner or later to make sure that little or no tax continues to be paid. Amazon is rising its market domination throughout the globe on the again of earnings that’s largely untaxed – permitting it to unfairly undercut native companies that take a extra accountable strategy.”
Amazon formally studies its British retail gross sales by way of Luxembourg, with Amazon UK providers representing solely a small a part of the broader UK operation.
Contemporary questions have been raised over Amazon’s tax planning this spring after its newest company filings in Luxembourg revealed that the corporate collected file gross sales earnings of €44bn (£38bn) in Europe final yr however didn’t need to pay any company tax to the Grand Duchy.
Accounts for Amazon EU Sarl, by way of which it sells merchandise to a whole bunch of thousands and thousands of households within the UK and throughout Europe, present that regardless of accumulating file earnings, the Luxembourg unit made a €1.2bn loss and subsequently paid no tax.